2017 has been a year of rapid change in the payments landscape. With technology advancing at breakneck speeds, it can be easy to lose track of what the latest and greatest trends are. Which is why we decided to make a list of the biggest trends that have ruled the year so far and are likely to continue to grow in 2018.
Mobile Boom
We took an in-depth look at the impact of mobile payments in an earlier blog post. But mobile payments have taken on such a crucial role in 2017 that it’s worth repeating here. Mobile technology has become a staple of everyday life, and with this nearly universal acceptance comes the rise of using mobile devices to send and receive payments. Visa posits that the number of mobile transactions increased nine-fold since 2010 with no sign of slowing down. Furthermore, they estimate that by 2020 mobile will be the preferred payment method for Americans.
2016-2017 has been a telling time for how mobile payment is going to evolve in the future. Samsung has expanded its mobile pay technology to work with low- to mid-range smart phones, making the ability to pay from your phone more widely accessible across all demographics. Apple’s iMessage now enables consumers to send payments to anyone in their contact list as easily as they send a text. Mobile payments are growing across all sectors, and as such have a direct impact on several other key trends we’re now seeing.
On-Demand Economy
As mobile payments have grown in popularity, there has also been a considerable shift towards greater convenience in ordering and paying via mobile devices. This is a sort of “Amazon Prime effect.” People want to be able to order quickly and easily from their device and have their order in the least amount of time possible. In food service, Starbucks led the trend in on-demand with launching the order ahead feature in their app. This convenience of ordering ahead and skipping the line is quickly becoming less of an option and more of an expectation. On-demand has also brought us things like Uber, Lyft, Grubhub, etc. which reflect our growing desire to be able to use our mobile devices to get the things we want/need.
Sharing Economy
The rise of Uber, Grubhub, and other on-demand service apps also reflects a shift towards a sharing-focused economy. Consumers are increasingly interested in being able to have convenience without committing to buying something. Uber allows you to get around without buying a car. Airbnb lets you stay in vacation homes you could never own. And perhaps the king of this sharing focused shift is arguably the original: Netflix. Netflix gives you access to thousands of titles for a low monthly fee, rather than buying or individually renting them. Netflix has become so prevalent that it’s now widely used as a verb and is seen as an actual pastime. This focus on sharing demonstrates a larger societal shift that focuses on having experiences and convenience, rather than needing to own large amounts of property.
Elevated Retail Experience
Tying into the idea of sharing economy is the current focus on convenience. Convenience-factor is such a key issue that Lux Research estimates consumers are willing to pay up to 11% more for added convenience—hence the rise of grocery delivery and meal-prep kits alongside the boom in food ordering and delivery services like Grubhub and UberEATS. Convenience is also what drives millions to Amazon Prime ordering, which is often pointed to as causing the death of retail as we know it. However, the reality is more that retail is evolving, rather than dying.
Retail companies are catching on to the idea of an elevated retail experience being the new key to success. As people shift to going online for items they want to purchase, stores need to find other ways of getting consumers through their doors. The rise of pop-up shops demonstrates one powerful means of getting customers to shop in person instead of online. Using events to create an enhanced experience for consumers is another highly effective method. Meijer stores in Michigan host an annual back-to-school Meijer Mania night for college students. The giant in-store party gets local students excited about shopping there by having things like mechanical bulls, rock climbing walls, oversized photo booths, and a live DJ. The idea of elevating the retail experience helps to forge a shopping relationship with consumers by showing that the retailer understands the customers’ focus on having memorable experiences.
Digital Personal Assistants
Apple, in a lot of ways, is responsible for many of the payment trends we are now seeing. They pioneered the idea of a mobile wallet with Apple Pay in 2014. Similarly, the creation of Siri on the iPhone launched the idea of having a digital personal assistant. However in 2017, phone assistants have been overshadowed by the creation of the at home digital assistant. Amazon’s Alexa on the Echo and Echo Dot, the Google Home, and Siri on the Apple HomePod all launched with varying levels of success. The Echo and Echo Dot have been the most talked about due to the overall expansion of Amazon into more and more areas of everyday life. The Echo devices are also generally the most affordable. The Echo and Echo Dot allow consumers to order anything they need by simply telling Alexa to get them something. The idea of convenience in commerce reaches its peak with digital assistants…shopping is as simple as saying what you want or need!
Bluetooth Everywhere
While Apple may have led the charge on digital assistants, there’s no arguing that Amazon has perfected it. However, the recent return of Bluetooth is 100% courtesy of Apple. The iPhone 7’s release was marked by a massive change: the removal of the headphone jack. This seems like a far stretch from a conversation on payments, but the removal of the headphone jack actually has immense implications for payment technology. Without a jack, users are turning to Bluetooth headphones instead.
This shift means that consumers are now returning to frequent use of the technology. As more people begin to increase their Bluetooth usage on a daily basis, it will become more and more of an option in all areas. This means mobile payments can shift to being transmitted via Bluetooth, opening up even more options for paying electronically between a whole host of Bluetooth enabled devices.
Beyond Pricing Pressure
Finally, we talked last week about how you can save money on payment processing. This is a trend that we’re not only familiar with but 100% behind. With payment processing becoming less of an option and more of a necessity to do business today, processors can no longer simply use lower rates to gain business. To be a viable processing option, you have to offer clients more than just lower rates; they need to be able to adapt to the demands of a very mobile market, have high-end security, and have options across all channels to ensure their business can grow in every arena. And that’s where we come in. With tailored, omni-channel solutions, the best security by today’s standards, and customer service that’s the freshest in the business, Pineapple can get you the tools you need to not only survive these rapidly changing times, but to thrive!